Canadian economy slips in April

Tue Jun 30, 2009 11:10am EDT
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By Louise Egan

OTTAWA (Reuters) - Canada's economy contracted for the ninth straight month in April as the manufacturing, energy and retail industries scaled back activity in the deepest downturn since the early 1990s.

Gross domestic product by industry fell 0.1 percent in the month compared with March, Statistics Canada said on Tuesday, suggesting the economy is entering its third quarter of recession.

While there were no surprises in the report -- the results were in line with forecasts -- it was still a disappointment to those looking for "green shoots", or signs the economy is about to right itself.

GDP shrank 3 percent from a year earlier and total output by all industries in dollar terms was the lowest since October 2006.

"The mild drop in April GDP reinforces the point that the worst of the declines for the economy are behind, but we have yet to reach the turning point," said Doug Porter, deputy chief economist at BMO Capital Markets.

The Canadian dollar was little changed after the data, drawing support from steady global equities. At 9:05 a.m. (1305 GMT), the currency was at C$1.1564 to the U.S. dollar, or 86.48 U.S. cents. Bond prices were largely lower, moving in unison with U.S. treasuries.


In a separate report, Statscan said the sharp rise in the Canadian dollar against the U.S. dollar in May caused producer prices to fall by a steeper than expected 1.1 percent from April.   Continued...

<p>The Toronto Skyline with a condominium building under construction (L) is shown in downtown Toronto, May 14, 2009. REUTERS/ Mike Cassese</p>